Orgell Sues Chopard

William George Shuster -- JCK Online, May 1, 2005

Beverly Hills, Calif., jeweler David Orgell has sued Chopard USA and its Swiss parent Chopard & Cie, seeking $1.2 million for what it calls "unlawful, unfair, and discriminatory business practices."

According to the complaint, in 2002 Chopard opened a boutique next to Orgell, a retailer of Chopard products. Two years later, Chopard terminated its exclusive dealer agreement with Orgell. The California jeweler now claims this was part of "an overall anticompetitive scheme" by Chopard to eliminate Orgell as an authorized dealer and promote its own boutique.

Orgell had been the authorized retailer of Chopard watches and jewelry since 1996. The suit claims it developed "a substantial clientele" for the Chopard brand, "introduced almost every new [Chopard] collection" in the U.S. market, and gave "substantial selling space exclusively to Chopard products," including in 1998 an entire "Chopard Corner" with windows facing Rodeo Drive to promote Chopard products.

In 2001, Orgell says Chopard asked it to sign an authorized retailer agreement with allegedly "substantially altered" terms. Orgell refused, but "the exclusive authorized dealer/retailer arrangement continued in practice and effect for over three years," it says.

In 2002, says the complaint, Chopard opened a store 36 feet away from Orgell on the same side of the street, selling "the same Chopard products Orgell was authorized to sell." The suit says Orgell "repeatedly voiced its objection" to Chopard management.

After the boutique opened, claims the suit, Orgell no longer received the same advertising support from Chopard, which also allegedly "tightened" credit and payment terms.

In March 2004, Orgell was told by Chopard it could no longer sell its products, effective June 30. Orgell says no reason was given, and that no other authorized dealers in Southern California were terminated.

A spokesperson for Thierry J. Chaunu, Chopard USA president, said the company has "no comment."